Bare-bones Cable Tv Is On Its Way

December 27, 1992|By David Ibata.

You can cut your cable television bill by half, but you`ll lose MTV-not to mention CNN, A&E and Nickelodeon-if you opt for one of the new bare-bones programming packages from your local cable TV operator.

At the same time that many cable companies in the Chicago area are preparing their 1993 rate increases-expected to range from 5 percent to 10 percent, the same as 1992`s-they are putting the finishing touches on a new type of service that will carry only the signals of local broadcast stations and public access channels.

For most systems, that means the new basic category of service will offer no satellite programming. And basic subscribers of Tele-Communications Inc., or TCI, the area`s largest cable operator, will not have specialized local channels such as the ChicagoLand Television, the 24-hour news service to start Jan. 1.

Cable officials maintain that they are only complying with a mandate for such service under the Cable Television Consumer Protection and Competition Act of 1992, passed by Congress last fall over President Bush`s veto.

But critics said the ``re-tiering`` is a way to circumvent another provision of the Cable Act that gives the Federal Communications Commission the power to regulate rates, with the heaviest regulation for basic service. That, they said, gives the cable companies an incentive to change what ``basic service`` means.

``What they`re doing is shifting programming off of basic service to more expensive tiers of service,`` said Bradley Stillman, legislative counsel for the Consumer Federation of America in Washington, D.C.

Cable operators said that the new basic tier will be optional, costing perhaps half as much as the present basic package, and that unless customers requested it they will continue enjoying all the satellite programming they now receive.

The re-tiering will not affect premium programming such as the Disney Channel and Showtime, for which subscribers pay extra.

``In the past, cable companies included in their very basic service satellite channels like CNN, ESPN and MTV,`` said Mary Kay Starzynski, director of industry affairs at the Illinois Cable Television Association, Des Plaines.

``Now service will be broken down even more, and the most basic service you can get really will not have much that we think of as cable programming,`` Starzynski said. ``The really good stuff will go to a whole separate level.`` But the practical effect, Stillman asserted, is to remove the satellite programming that has become a staple of cable television-from Bravo to ESPN to The Nashville Network-from direct rate regulation by the FCC.

The Cable Act empowers the commission to set rate ceilings for basic service, but not specifically for other tiers.

So if satellite programming is moved out of basic into ``Expanded Basic,`` ``Basic Plus`` or ``Standard Service,`` the only way consumers could contest high rates for those channels would be to petition for hearings before the FCC.

Cable operators are re-tiering all across the country, making one wonder whether it is an industrywide survival tactic-to best position cable TV for what is likely to be a long, bruising, litigious fight with federal regulators.

Even cable executives such as Emmett White, senior vice president of Midwest operations for Continental Cablevision in Elmhurst, predicted that few people in the Chicago area will subscribe to a broadcast-only tier, which essentially will only offer some consumers better reception of channels they can get over the air free.

Continental has offered such service for years, and less than 1 percent of its 225,000 customers here take advantage of it, White said.

D-Day for the cable industry is April 3. On that day, the FCC is scheduled to release regulations governing rates for basic service, customer service standards and rules on whether broadcast stations can demand payment from cable systems that carry their signals.

By April 1, though, all TCI systems in Illinois will be offering the new basic service, according to Ava Whaley, vice president and state manager for TCI.

TCI subscribers now pay $20 a month for basic service, but under the new system their bills will be broken out two ways-perhaps $10 for ``Basic`` and $10 for ``Satellite`` service.

``The lowest level of service would be the regulated level,`` Whaley said.

Whaley denied TCI was trying to get around the rate caps of the Cable Act.

``Our primary goal is to allow people, such as senior citizens, who do not want to pay for satellite programming to have that option,`` Whaley said. Meanwhile, other TCI officials said, the company is planning rate increases of 7 percent to 9 percent. The new rates will take effect on July 1 in TCI`s largest systems, Chicago Cable TV/TCI in the city and TCI of Illinois/Telenois in the north and northwest suburbs.